US, European stocks up as traders weigh earnings, rates outlook / Photo: © AFP
US, European stocks up as traders weigh earnings, rates outlook
US and European stocks advanced Wednesday as investors digested a barrage of company results and assessed the US Federal Reserve's interest rate plans, while oil plumbed more multi-month lows on energy demand worries.
Wall Street continued its upward drift at the opening bell, but gains were small, with the Dow adding 0.1 percent.
"There is not a lot of conviction in this morning's trade (in US markets)," said Briefing.com analyst Patrick O'Hare.
"The most transparent explanation for that is that there is a nagging sense the market is due for a pullback," he added.
Wall Street stocks surged last week after the US central bank hinted at no more increases in interest rates.
However, Fed officials later refused to commit one way or the other, instead saying they want to see more evidence that inflation is on a true downward slope and the labour market has softened enough.
Data on Friday that showed jobs creation was slowing -- but not too much to cause worry about the economy -- instilled confidence the Fed was on course to deliver a soft landing for the economy and avoid a recession.
With more monetary policymakers set to speak, including Fed Chairman Jerome Powell, investors will be keeping an ear open for any additional clues to future interest rate decisions.
Traders have also been concerned about growth prospects.
O'Hare said some investors seem to be worried the drop in interest rates is more an indication of the degraded business outlook than a catalyst to boost growth.
"This disconnect likely helps explain some of the churning taking place right now, as market participants struggle to reconcile if interest rates are going down entirely for the right reasons," said O'Hare.
In Europe, London stocks edged higher, aided partly by a 10 percent surge in retail stalwart M&S after it announced bumper profits and a return to the first shareholder dividend in four years.
Paris rose nearly one percent with lender Credit Agricole jumping two percent after logging a solid third-quarter performance.
Frankfurt also pushed higher as Commerzbank shares rose 0.8 percent after it lifted its annual guidance and posted rising quarterly profit.
Asian stock markets ended mixed.
Oil prices sank to levels last seen in July on heightened demand fears arising from the weak global economy.
Crude had already plunged about four percent the previous day on news that China's exports fell at a faster pace than predicted in October. That stoked fresh concern over its appetite for energy.
"Oil prices tumbled head over heels," noted analyst Stephen Innes at SPI Asset Management.
"This sharp decline was primarily driven by concerns about the outlook of global demand due to weak data points from China and other economies."
- Key figures around 1330 GMT -
New York - Dow: UP 0.1 percent at 34,190.97 points
London - FTSE 100: UP 0.2 percent at 7,423.22
Paris - CAC 40: UP 0.9 percent at 7,047.89
Frankfurt - DAX: UP 0.6 percent at 15,247.03
EURO STOXX 50: UP 0.8 percent at 4,187.19
Tokyo - Nikkei 225: DOWN 0.3 percent at 32,166.48 (close)
Hong Kong - Hang Seng Index: DOWN 0.6 percent at 17,568.46 (close)
Shanghai - Composite: DOWN 0.2 percent at 3,052.37 (close)
Euro/dollar: DOWN at $1.0676 from $1.0700 on Tuesday
Pound/dollar: DOWN at $1.2271 from $1.2300
Dollar/yen: UP at 150.88 yen from 150.37 yen
Euro/pound: UP at 87.00 pence from 86.99 pence
Brent North Sea crude: DOWN 0.8 percent at $80.95 per barrel
West Texas Intermediate: DOWN 0.8 percent at $76.79 per barrel
O.L.Jiminez--ESF
